Ballmer: $5.6 billion-11.3 billion for search over 5 years

Microsoft CEO Steve Ballmer had quite a lot to say about Bing this week, and …

During his address at the Executives' Club of Chicago, Microsoft CEO Steve Ballmer Ballmer emphasized that the company is willing to invest up to one-tenth of its operating income in its search business for up to five years: "Our shareholders, I told them we were willing to spend 5 to 10 percent of operating income for up to five years in this business, and we feel like we can get an economic return. We invested in Xbox for years and now it generates nice economic returns for us." Seattle PI did the math and said that this percentage computes to between $5.6 billion to $11.3 billion over five years.

Ballmer also noted that he is aware it will be a long-term battle: "In our industry, the No. 1 mistake that people make is that they quit too early. If you look back at any great technology business, it took a while to build up." Towards the end, he opened up for a question and answer session and when asked, "If you could have one do-over, what would it be?" he gave a surprisingly honest answer: "I would probably say I would start sooner on search," Ballmer told the crowd. He noted that Redmond knew of search long ago, that the research and effort had been put in, but the software giant just did not see a business model.

Bing, Microsoft's latest version of its search engine, launched earlier this month and the first reports say it is doing quite well, though we maintain that it's just the beginning and anything can still happen.